Tesla (TSLA) 3 May 182018 Q1 Earnings call transcript

Good day, ladies and gentlemen, and welcome to the Tesla Q1 2018 Financial Results and Q&A and Webcast Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time.

As a reminder, this conference may be recorded. I would now like to introduce your host for today's call, Mr. of Director Senior Viecha, Investor Relations. Martin may you begin. Sir,

Doug everyone. Thank I'm first Tesla's and Ahuja joined afternoon, you, good Welcome and Deepak quarter Straubel, by Musk, to Elon Sherry, today JB Field. XXXX Q&A webcast.

Our link Time we the Pacific X in webcast. this were QX the update same announced results at about PM at published as letter

of or on outlook the statements. These forward-looking could this we our and due number During predictions make to call, events filings mentioned will uncertainties, of and discuss our today. expectations materially differ risks with as are most recent results including our based Actual in business a SEC. comments those and

call, During to limit yourself and the of one question-and-answer today's please one portion question follow-up.

opening Before Elon? remarks. jumping into Q&A, some has Elon

most but going it, our I answer I on and says think spend to many try letter we're as possible. Q&A to time extra as think questions of

you that rate of of machinery, improved uptime as you refinement. in to a per hours even the as and The are we're extrapolated should it achieve in in got outward is would packs I peak, so the XX you take the going continued as answer, output. a we cannot then most sustained I'm that thing sorry, cars system Gigafactory questions day Obviously, achieve We hour be go to peak the good hour about about X,XXX excited means be peek last an a assume week. sustained rapid of can – once think a over and the more is hour good rate to but per increase and there as to able long refinements hour managed with reached every rate with it X,XXX just actually with of per operational can achieve at if week, answer.

I least in to system be a production is you month operational whole exponentially dramatically uptime volume production spend got found that the also is some that and more confused. design there the very that One to two some are ideas, that very not junior the simplifying able pack or what's solicit is the quickly we do of for design X,XXX ways way everybody's to good interesting able I It's we flow. discover the of to CapEx. them, that I are thing to improving less general, suited were really a improving we've think. well then change things that think, and that our case as well improved achieve production manufacturing just into mean, So, designed that seeing minimal not be well and how and in those that the at how automated fact, operation ideas needs essentially this should CapEx engaging operation, are and improvements parts something improving and with we do no over amazing with things implement part associates will two And that by ongoing in to line, are and matter of very suited are made. so all by well in dramatically, introduce manual when that our understanding we is making

Tesla So, system production automated. that vast of I be clear the should majority the is

of basically battery is on One few pack. this months things. silly we front ago, fluff. However, automated – too top some as did automation the – fiberglass of I've would be, foolish mentioned in sort the far we had on and a the this go we They're tweet these ironically a example have pretty mats

of the the ridiculous. battery of pack, which automate tried placement we and to is top to fluff bonding So, the

are an picking not incredibly fluffer Human that. So, which up of had hands are work. pieces really doing better Machines was good way machine at at make we bot, difficult fluff. to

And had put machine a try using complicated the piece system to a of to vision a battery super pack. so, we fluff on

the need out found that a cabin. in without car So, tested actually do that? One no volume of with in and I we we was, the there questions change noise asked and was the

just was actually like, the was we pick because a it unnecessary. in, while bot So, had forced line would up a down location. part fluffer kept fluff that – That put breaking to frequently random failed

remains I we're found. So but be one of the of a the that was still in fixed to And things cases, silliest this over-generalizing lot design.

unit, for on. drive which a the port we example, battery a for the has blanking put pack then front sealed plate So, car

So a unnecessary. cars, We've which and essentially a step, crazy. unit for put the is we that rear-drive added over plate and added punched a a is then of added blanking manufacturing we've mode, all cost, that for hole hole kind we've in failure something do it,

improvement taking an from went a So, minutes Battery is had to to in that (XX:XX) radical changed. the production example net that's seven weeks we've pack of a And result pack now. make three production. is XX ago something under hours

that, are So indeed like, really radical it's improvements show possible. just

of vehicles enormous out, should I a also of rates we're point and week. production. We saw sustained is to improvement in a achieve module zone fully X,XXX automated also able four This, zone,

confident in work than module area, the the And vehicle plant, production So, at X,XXX the will assembly soon we're factory expected. actually primarily slightly and mark some with I'm exceed we Fremont. general in very ahead pack in Fremont

with almost general automated, which They're there already shop, which week. in reduction temporary then few places body should be – capable is automation reduction some with X,XXX will body. able the should some I up say, we then of already the we in improvements, a entirely a we're weld in X,XXX. over (X:XX) cars include also the where assembly So, And

share and done. about I'm an basically of has worth in I'm the noting production So – the versus X, see and outcome. and work this amount work competitors very sedans. been Tesla chart a mid-sized feeling proud It's premium market hard sacrifice some team Model of talented very the achieve X people of really Model by you There's the to amazing good the

this States as something year. be and there May odd do. there's chance have there brands likely, far sedan this in coming share good later against This there be to a market from We market of more in close majority really seems year. will the to the majority I we XX% sales this outlets start premium mean third – and gets sedans, almost really maybe later unless April in is mean, who of be Model category are May, we're then – certainly think X XX% a maybe in In established outstanding I I the mid-sized and United of lot best-selling a share than quarter we

confident So, appear in this flow view. about letter GAAP and it is quite says, positive cash my feeling achieving a I'm the very QX. encouraging. quite net likely in but This does is income Yeah, as certainty, not

got contracting of front. to barnacles that in out up sort going on using and of sort to going restructuring on conduct of barnacles. goal. scrub the particular, crazy. companies pretty we're third-party we're that control, are We've achieve this barnacles company that We a to of month, we're has well It's And the reorganization, of gotten so the number really set make sure

removal. of right. be to a All barnacle lot So going there's

make guys want to You comments? any

Thank let's question. Sherry, to you, Elon. go first the

Thank you.

Johnson Barclays. from comes Brian Our with first question

what five-day bit – at talk to is Good about, first get want the talk afternoon. assuming talk the X/XX? to point about if about you think sort related – of two that little of a Yes. of Or production week all, if we the rate, sort operation? X,XXX it's ramp you per we I all run shift to do

this of it to what have way because of CapEx, two nor very is shift Well, the a that ridiculous that a we use I operate, be for is would is poor a five-day operated think most operation Tesla. way

operated production day module module which the been basis. to operated the battery on a has pack and shift, production cell powertrain six three a assembly, basis. on six-day XX-hour exception of to So and a general is operated and And kind five on typically is shifts, so always XX/X production, two which paint have

sense we it production. same but on think the operated to on operate I company majority a whole started production makes has a since So, basis, of Tesla basis, the XX/X

JB. Yeah, is I in. I can chime this mean,

shops, makes it that's use great the aligning so. we it lines so to the everything back said, shift way don't why it at much because starting of the inventory, really and we the CapEx same different S. seesaw make have of But between in the inventory inter-line schedule did Elon As of efficient, the more beginning

Exactly.

then capital up One of don't you if – work not of inventory improving warehouse. system if shifts are a to in kind process key you reducing storage the is things have efficiency of to the and have build in aligned the

chip we're called (XX:XX), five-day two-shift a of actually And but fab so, capital pretty is – so anyway. something whatever. foolish work AWS, efficiency, called it's the this there's approach a been it's sort operate on called like to alternate but to thing Yeah, it's using

Week.

pretty that. Yeah, like workweek. alternately, think long and Alternate work people cool, I long days something like three they're then four days

overtime rather crews using than just Multiple weekends. on

Yeah, yeah, exactly.

Right.

as a... seems it So, like just

like a day, working are It's days person seven like one not XX shifts. a hours five or four week. There

Yeah.

do targeted whole at I of going to And understanding minutes. to best-in-class I faster seconds past that some that. is XX go at blowing mean, seem XX sounds to time and you're I the But my prior get would of takt actually other than just that's grandma like X,XXX the sort to factories? sort a was math conversations, two So, takt time of if the of I the back it is of walker minute, thought you

is actually The number. the number assembly general to referring you're

per Vehicles minute.

number, yeah, stuff, Yeah, assembly but... yeah, general it's other not

of faster taken have the may the (XX:XX). the or line, time uptime OEE, so-called which takt account a make not tends the little You to into also than actual

also there. rising so like like we today Yeah, that I a a Like workweek. was in packs hour, peak a pack say, XX production pack (XX:XX) a then, did it's we're mean, and minute say X-day, under we over – just takes could an like from if XX-hour minutes Toyota two sure,

per and subassemblies up unit go to we numbers are rapidly as Yeah, go that higher in the the quantity car.

Yeah.

we per then still XX, factors have smaller than and or are that. subassemblies higher module So of XX even that XX

trying competing on said, can, just the is factory. line absolutely and And the two what manufacturing order be to can dollars and with that on CapEx just duplicating spend and it's speed double is double, has the other velocity a density. in than rather over. billions that minor with double that to of I Yeah. And do production, one velocity; path by efficiency a are if believe working companies its Like, to CapEx, up we'd one to game

again meantime, X,XXX get to Right. stops the in some starts, some (XX:XX) I the to saying lines – week? you're get But the what per

equipment upgrades. do zero you can't like maintenance – zero like you to have and Yeah, time have

do You maintenance, to just operating XX/X. peak at it you can't have be rates ongoing so have

Thanks. Okay.

Thank you.

next Rod Our comes Deutsche with question from Lache Bank.

Hi, everybody.

Just wanted of follow line along that questions. on to

can in to So the X? processes, us you're to extent that changes affect extent humans the certain extent Model the help the interpret on you just which economics to adding that these how the competitively depreciation And some in or competitive per of efforts all vehicle? OEMs Tesla other per terms hours these analysis, production done in you've vehicle stack against you of up system, labor automated do

few Deepak I a things, can elaborate. say I'll Well, – have then

about Let's keep maintenance like have I've if order a the was noticed of have engineering. to to a talking that you machine operating see, it fluff thing earlier, the so bot really have that you is, ton I complicated in

be like, the basically hours the day. cost like, it, I battery of exceeds week, may cost have, the labor pretty thing of pack, placing that you cost margin, far to maintain maintenance the simply on gross maintenance as and X-days XX fix but said not nonetheless that a a So, fully engineers have into that directly unnecessary. was the The engineer basically expensive incorporated which is a fluff

of having that production poorly – producing because costs really to actually robot our getting vehicles will stations a the not think expensive do of actually very robotics, impacting are rid long-term decrease. I costs. our most see I technicians. Fully will of that considered the likely of I cost this costs see So, suited by mature, decrease

CapEx-efficient, Rod, overall. we are very

we automating it's lot once some impact, a in the just per expectation and point. the at run week, indicated we costs of depreciation well our below on is we my there look of – depreciation labor well me start temporary. labor out per production clearly have are our if most Let then basis at from fully of of per a mind added, then overall, this cost. but sense. makes we $X,XXX from letter, additional out in ways our or where rate it X,XXX stabilize as figure unit competitors will And we've smart come is And unit so And below steady that cars

Okay. comments give your terms batteries advances how translate metric kilowatt letter making? we into Or hour? Thanks of were Could the in some into just the can you're And for on per secondly, that cost insight some your you in us that. interesting. that in gains

point, we that Every don't we Rod, are data that at best-in-class, prefer to... we suggests but look internally

We're best, which is class. not a

We're Yes. best. the

Sorry.

The best-in-class of one.

to cost we're the on in it's been helpful a commodity recent the price and several been pursuing something understand reduce has now, literally think instance, overall the usage, kilowatt for this with batteries. commodities trends I been especially Rod, and movements. Being that helpful years hour, path directionally, for in we've the to cobalt has working on per different extremely

a trend. pretty So, quantitative, we can't really is that directionally good be but

nothing. to we Yeah, we cobalt almost the can think get

Okay. Great. you. Thank

very much. you Thank

Let's have question, please? the next

you. Thank

comes Jonas Stanley. with from Morgan Our next Adam question

think Thanks. need on would repeatedly issue need think capital I that at this you to not call better Elon, you recent so it's equity said Tesla, do you to. don't many in to capital weeks raise when say and I investors

guess is... the first I So question

I disagree.

you to? want you Yeah, to, but do need not may

don't specifically I want No. to.

Perfect.

next Okay. currently and data, cars business My of a amount year your SpaceX gets satellite the Elon, large is into somewhat... produce follow-up, broadband

Well, ad (XX:XX) hoc, yeah

Yeah.

Okay.

next Not it's three probably but years. year,

Three years. Okay.

Yeah.

that. for you Thank

secure advantage. that data resilient potential pipe a Some cyber SpaceX competitive this vehicle Tesla argue precious and offer could for a

obvious isn't and collaboration day? Elon, Tesla SpaceX between So, one an bandwidth for domain

and interesting Internet could to connected right. lot you're do. haven't about LEO cars mean, it There's power, the I and computing things of might it, connect could and to it we I lots cell certainly a And it's be. got Wi-Fi networks but you of everything. probably The thought constellation.

Thanks.

you. Thank

please? the to question, go Let's next

you. Thank

question Tamberrino Our with David next from Goldman Sachs. comes

already the of Thanks Fremont quarter. Model so what take the you talked are have planning those to Great. plant? Fremont taking you What kind the X, And addressed to specifically bottlenecks the you're you occur later? to for this downtime going to remaining little periods XK the are in you for a address has other going quarter, far? planned get my in is occurred, on questions. about the two alone And bit to within the Elon one later

Gigafactory is size-wise bigger just maybe of Well, the than this point Fremont. fast, two at it'll slightly factories any The and smaller Fremont Tesla Fremont. is footprint. biggest second production is but between have And we literally and Giga the than so system kind earth still be the yeah, like (XX:XX), Fremont, on the by soon building – biggest

a is coming fundamental is and Giga get manageable. sold straightforward, like on body end in surgery right. battery like motors And I'm shop and impediment These Giga, and next general then that a inverters thing of month. general work, paint power, There's kind a biggest on in things of question very ability at And no said, quite it's you Like – it's to assembly hard So, of packs it feel brain assembly. – not the personally after our it's X,XXX month. refocusing second and to yeah, problem, of the and next I There's (XX:XX) work. and, the the is complex very just by that biggest time lot to down probably really full our maybe need doable risk, and answer chargers all not are risk a but getting quite (XX:XX) the soon these it's our to lot here. lot rate get confident essentially XK very to about a that at sustained is vast I one. production,

software in our system. the and car, to gains many huge cases, central automation through we've controls the connects software, software In that that's seen

it's substantial So in cases, that upgrades even many hardware create in not increases velocity.

as production, Yeah, exactly. Tesla. – is here. one a system car Tesla good Tesla way at good as remotely problem. company. any that there's production think the is Doug great point that a is industry I primarily makes the as And in a software better auto really as is than – other software software And no

is is, in biggest in position. true, if what software, we good production that a system the challenge is are it a saying and I'm So

launching a to for Okay. your and P&L XXXX? from this? in next begun timeline taking you my only an Y start that different spend for Maybe the a question the in is What have hitting Model and R&D perspective begin direction. Or to CapEx

It will significant only start in to become XXXX.

Okay.

So X Model spend all of CapEx this is Fremont associated with year the for Gigafactory?

it but take start a significant number big our I to a big right please literally. to zero number. become will it said next only not relative now, revenue. It's It's don't year. it's no, not not No,

product In becomes... the CapEx. not development of days CapEx anyway there's much early

Yeah.

as to equipment committed become in-house. you starts to (XX:XX) equipment and

Yeah.

Although, amount spent development future it at is the program of for the it have of low, in is beginning (XX:XX) remarkable, the implications like, with quite money CapEx. really begun decisions program, made although beginning development massive

a than from go better ahead pain we product, the made X will Model through much manufacturing more right because decisions. So bit decisions through It producibility CapEx thinking design we to I have. Y, manufacturing want I the we it do really racing question incredible be is and could Model this with again. time standpoint, no There's a before easier to not produce the of have making Y going revolution. think to Yeah. Model to a be, think, is spend

much. Thank you very

to the question. next go Let's

Thank you.

Romit next Instinet. Our Shah with comes from Nomura question

I related to in Hi. clarify X the to letter. just put the comments you margin Yeah, Model wanted that gross

things. You said couple a

said be of over margins the X You XX%. below target gross the medium-term, would Model

said that in margins highly those be and QX, also would You gross QX that positive.

gross X close get to margins what's trying to a we So, of possible year? the XX%? the to by that's Could Model I'm end number for just understand

be it'll And we labor. and out yeah. from yes. into come take other getting is how to The and more is commodities that costs what progressively answer come from economics I'd What each better, say down to will currencies play quarter we much

want close don't give to to you I So, it'll number, be a it. but specific

Yeah, above. could lower, slightly exactly. It's be it to it very be slightly could close XX%,

I you Okay. Fair about... ask just enough. can And Elon, then,

Sorry, XX% just going the say QX. a little confident forward very of gross margin... further than, We're

Thanks very about we good that. clarifying that. Yeah, for feel

we XX% year, definitely is what next For expect. would

you when you're medium-term, talking say So, XXXX?

of but where why Then clarify get QX we'll exactly. we was when the to then, try by the about should be XX% we I the things year, by looking middle And is mean. gross forward or margin – be Yeah, are. what expect high-XXs also to That's on these to next XX%. next year. to

Okay.

Okay.

could just comment does Keller's As autopilot? the A it silicon say, development a follow-up, Jim departure? respected you Thank about if on architect. chip custom anything, of Tesla's highly What you. and

Well, of to which a kind for time guy, a pursue a how long great of to there's and redesign architecture sort wanted he works. is server Jim's career

by who be that Something Bannon, primarily AI sort Bannon, designer Tesla – bit Jim he to interesting, still that is (XX:XX). little of I is led is Pete hardware the of of and but been a that head And, find that should our design personal is of something (XX:XX) Jim's lead clear Pete to Andrej went The it's it's of course, The dream I (XX:XX) with do Tesla. why a Intel. Karpathy team. that's

to replacement for So, we don't a Jim's position. hire plan

Great. much. you Thank very

Let's to the next question. go

Thank you.

Toni with Our comes Bernstein. next question Sacconaghi from

gross and follow-up to margin I you. the question the wanted on previous Thank just targets. Yes.

you said that felt you Model could last had XX% to gross X,XXX you that I get once margins got quarter on to units, X. think you

think And are. at trying quarter you that it understand I'm key headwind, don't it I or made relative the when to what drivers least delay the six-month substitution? changed I you capital be changed. like those understand to feels hasn't think sequentially really for currency nine-month thought to relative ago. I Is but has it what can statements a a labor So, much. a

you perhaps before? of to Model you in a us ramp have thought understand can for I follow-up, relative terms So, margin has And help X what please. gross what changed the

as and letter. temporarily, Yeah, the it's of the that is tariffs, at material well dollar commodity we said plus countervailing duties, increases price using XXX the lines in we as the along significant labor. of Section the adding recently combination more what costs. weaker If imposed then And look we're

what come you the certainly will when to combine guidance. will address, And that led cost out. our those that's So we piece and two, labor

solve to Yeah, we're but difference, X% X% later. three and something within to like about talking a we'll six-months that's that

case it's it. not So like out it's some of (XX:XX)

And billion, for are Okay. $X capacity separately, the less projection anything And of does and specifically, Model spending lowered both then year? taking that you if out your what terms take battery CapEx X? terms in for of production in you where in this than

just much So, being more smarter many we're in cases.

X. course, we we then, critical on said, our Elon line and looking growth money And We're, about automation. As in business. spending with and CapEx the helped we're our problem, simplifying us at it how it, infrastructure our of on are just grow not up that's also reduce being Model our

So, we we is reduce there if feel that further, these are still the right it to us decisions, for wish room and to.

are we where spend some needed. So, money to discretion here ourselves go leaving

in be requirements? you will specifically where so terms of And capital

Excuse me.

bonehead Boring cool. are questions not Next.

Next?

Thank you.

comes question Markets. Spak from with next RBC Capital Our Joseph

you. Thank

first have of maybe us I had. opened impact the reservations configure, the us X available Like, reservations, taken just that to The percentage was configure? like, some made gauge let news actually the know, Model to the that is has if you can step the related question of to and wondering what actually as gave a you and

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Thank you.

Galileo with next HyperChange. Our is from question Russell

launch or me taxi date retail to Thanks. an to having could was launch call this service give the rollout? update on us Waymo's the geographic plans markets Hey. for any in Tesla limited if Great quarter. wondering on Network? I you Thanks details surrounding autonomous investors. with year, And represent the an

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work, sort the for place. all So, in pieces need the in of whole you to system order

as it and, enable software enable sort Lyft a I autonomy, thing, an autonomy, to cars people road, build like, kind level to cars their need offer to obviously, to infrastructure and or to want cars car XXX% behind usage can of like and able effectively on of type have of the electric autonomous of a that the own robo-Lyft car. to or share and a your Airbnb you shared of of combination full five, and their be robo-Uber, where You then guess, four whatever have call Uber, lot you

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really having if not (XX:XX) I millions millions, are vehicles electric ultimately we're of autonomous the want decide right shooting foundation share shared well-positioned to So, building think we're said tens I (XX:XX)... think like you to. I don't of for and – the

expect even the the you this Do timing, though. timing on could have to details more about specifically learn we when service? about of And any or

– of XX%, autonomy how thing we do tricky think a regulatory the The even even It break would year. be or our with car that's hardest none because vehicles think substantially, I the is – to about is though read million automotive but it there's reduce about? per timing the to reduces probability them. we is which there's X.X reality doesn't you Basically, over approval. many improves million, autonomy, deaths the broadly by of like incredible And thing zero. that death autonomous accident the autonomy a X rate rate that fatality Well, think

they really an and autonomous -actually if fails it's about news, the headline that's situation, cars but to the to the but, writing media not that really should writing click are mention on. However it's story they the autonomous story be story, be how shouldn't that people want safe,

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we've got regulators obviously and respond press. to and then pressure with So, that the deal public to

incredibly might to off, journalists difficult. less die. people any And, the Because challenge press, article be people predicting to and really misapprehension that actually write the is it I the then believe regulators, where of the if laboring misleading of So, public integrity is to yeah, it safe. it's is find press is autonomy that hounding an lead is of on very that with turn autonomy less would and this because then irresponsible safe

really by anyway, upset this. So I'm

Yeah, really Thank you. interesting answer.

is Tesla from technical think a safe I standpoint.

the of next probably ready end I think year. we'll be by

production Awesome. with S, And X. XXX,XXX conference around was one quarterly a thing and then it call, you and line, capacity max cars seems. is Fremont more last Fremont X, quick mentioned that capacity somewhere speed because or the And this mentioned you in And there. on for the the lot something of

Y report at saying Reuters start a got XXXX in November Model would recently we Fremont. that so from And production

you year, actually And so, I'm these just like, launching kind where of curious vehicles? Y are with planning that the on Semi Model next and assembling

Like came nothing. I report on based is The from. Reuters know that don't where

Model year. We to the will I on of not Y XX from it's months at now. would starting say be probably closer end production next

not production prospect that. for for so Y, the the fit Y location here the to Model production, We're where Fremont. been could we'd decided. Y And more it's a early I put likely Model don't XXXX So difficult We Model is at crowded not has Y production imagine Fremont. XXXX. just Model know really at

the to here. jammed are We gills

So and production, we'll the it's for not one we're Model it's sure, I crazy is but not here know location packed It is out figure Y Fremont. optimal so – here. thing what yeah, to for here. Not at try

CEO seems Okay. pack a but specs of in of physics. truck, are technology, believe I it expert the of speculating And even Daimler laws for Semi an people that not lot I'm breaks the the said the it that battery

wondering So, just this linear... is a I'm

actually in engage physics in him. doesn't know He physics. a know I college. I'd happy to be physics him. studied about with I much discussion

So, question yeah, of platform that are built linear or going sort is be battery Or a different Roadster and in is my on? new your Semi the improvement to some that breakthrough just there technology?

Even XXX mile if going better at We're to could technology our miles. at we achieve we range than battery do XXX all. truck all, didn't improve a

JB. this Yeah, is

doesn't I it require dramatic think some the key point, breakthrough.

there's So, the a what in existing products can our I current actually of think fundamental technology do. misunderstanding

Yeah.

the best be that's benchmarking misunderstanding sort they supplier... versus sort in And from coming the battery maybe if of they're industry. of of from of That the that's a pack status of could buy others some just the current where the technology can

Yeah, exactly.

do, could And doesn't it the mapping give doesn't what Semi solve. you then – it that

right. You're

do Elon we some where but those basically we maybe as today or from, that's think what coming in-house to of how need and I understand have specs better it's said.

range can a We Semi today. XXX mile do

about I XXX-mile think range. actual production unit will the be

stuff. Great Awesome.

with best XXX a to mentioned wondering, also kilowatt-hour Supercharger? know let you've VX... Because guys I market to you I'm going are So, you Porsche

if We'll not that going (XX:XX) are boring. ask you questions keep

ahead. Sorry, go

I keep going, can Yeah, so.

way is interesting. Yeah, more that's cool. This

JB lab know a XXX like The that the to to Elon, technology, quo there you from rolling mentioned with charger that on they're that the keep going were sort I if it. Supercharger you've (XX:XX) Supercharger. indicate status out, of mentioned your guys they kilowatt seemed VX call but Porsche, is

So, I'm will on VX? if to improving there just some trying clarity get Supercharger whether or not, your and technology a is you be

poor. be energy sense, thing is a going improving like got you've Supercharger XXX high it Oh, monster we're definitely battery make going to doesn't density unless actually kilowatt in a C-rate, technology. pack be is of charger about crazy have which case or to The a a our your ton

kind pack think know XXX XXX going we for single – So (XX:XX) to really – of they you car, the kilowatts if per cockamamie. pretty on that's frag battery do I it's kilowatt, don't a you're if maybe also car made Yeah, that. a

kilowatt-hour that a unless pack You very rate, charge a high-energy high pack. battery battery cannot it's at

couple something I kilowatt, the – don't JB, know, kilowatt yeah, So think a XXX – I along maybe. hundred, XXX

we've Yeah, utility and I that explored and around cost sort car trade-offs the it optimization comes versus level down mean, discussed that's power also in some itself. of to an the and of definitely

charged there You essentially range speed or of Elon, and battery. trade-off is kind between of that fundamentally hinted cost a but

Yeah.

kilowatts. trade-off it's customer. we and at We the XXX very and pretty that look a pack to But could carefully. we the than charge XXX, could And understand a not that faster useful at design cells trade-off

really? energy power (XX:XX) even and Yeah,

Yeah.

range – kind Energy peak of (XX:XX) is energy. consumer rate then and the power you like acceleration at basically, your which

but minutes two that XX in you superfast this like important can have could important phone you more that days five it's long to or say, have hour – charge it's devices you have Would minutes in cell of sort and is charge And really, maybe two let's you charge. a than hours. about more that time. lasted only cell it So a use. a lasted it phone rather the to lasts takes an to to but two think have range hours, it Or

Thank you.

next... Our

(XX:XX) interesting. going keep We'll they're to while

I Yeah, more. a have couple

open automakers are system? ever For that owners up of that infrastructure, and guys revenue the trying know to Superchargers. off I and from to you but you other not generate profit that with Tesla try would

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why is not it that up, why So open a moat? and

Sorry, can you the question? repeat

years for so because the feel of would a as take strategic I moat, replicate, closed. to up just just charging about guys opening that why you a isn't have investor, curious I'm millions infrastructure built another wondering and dollars long-term that the brand like I'm thinking behind keeping versus it

lame. all, nice of sort think First I of way. are a quaint It's moats vestigial in

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truck mega a for those terms be in And at the going guys selling are of customers. fixed noticed charger, you to price I energy

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any system seamless that. that, haven't sure to a very frankly trucks any talked really easy need finalized is wherever go. haven't that to and We We make about operate to they of and there of want

with And a on of us think may be lot ways elect can or to some work customers there's that different that But the of it. solved. system, parts whole I

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sure we important, low have the economics trucks in the cost make mega-chargers, or a have electricity. up So incredibly the call or so that set are way to we Superchargers and them, or whatever are very to

give can mile customers the about. deterministic will really decades, really, And per proposition generation point we're up not to Ultimately, maybe the energy that price incredibly over change is of is petroleum super an that that cost customer. related interesting fleets. trucking One I future about exciting link affordable a also color a that something is very which potential and fixed very that excited think with that renewable this trucking an to slightly pretty for cost at to

Yeah.

I have one last one.

is really It's what that. emphasizing

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predictable. It's

cost? truck. what be the cargo? mile mile And truck still of predictable the or is diesel it's have we in What's would ugliest Yeah, than the Primarily market. a it's drives like, very the could And commercial and that world trucking lower the and victorious. cost it kilometer per cost per

the dramatic grow you do especially reductions, with thoughts on like are that, things able could Yeah, and have trucking actually on building guys change cost market or any platooning? on how you potentially if to deliver

will of away able is a competitive the it the revenue it bit rail to operate think only with railway, because railcars, quite reason be lots from need I platooning effectively you of just is train. a take small to and crew

don't go trains However, everywhere.

truck rail deliver have to has rail you spur have got there. at pick the destination the the train So spur, truck and over then from it the a up to things

plus So, you still train transfer. trucks have plus

a So, platooning industry I rail negative the quite in think affect dramatically trucks way. of will

supply I promise. On side Okay. that constrained, not I Last constrained, Energy, assume that one. demand on guys Tesla the business. are you of basically

how do? So, this changed you're sort how scale. in industry's versus utility particular, I'm And batteries South in Australia prioritizing the perception is what can of successful project residential wondering of

Yeah, it's had a I effect. quite profound think

worked and factory, on well. really Australia South took it's chance a out doing world's the biggest

than because read level, is to any at the expectations, battery plant. If the beyond respond far worked faster their it's far you the hydrocarbon articles, out able millisecond

much (XX:XX) respond fast. battery greater stabilization was its so, which turbine a normally even gas And than grid quite and actually plant,

like of feels kind and Tesla on like that it's with It instant a the you like can mind meld you sort So, car. have you have get acceleration. – of

is of is the you. that So it's like car the same true rapid And pack. response battery

months. that I deal be to gigawatt-hour a that pack, matter the worked we'll really at battery we've far utilities announce feel within So and of able the confident a scale loved thus have the

per X,XXX-megawatt-hours it's So, (XX:XX).

Yeah, demand we between Powerwall under – than maybe do there's we of increasing going be and reversing that that. are and focus to just know demand the still accurate are our and best trying is slightly. longer-term and now. it actually enough the is up question our and a bit I first we're absolutely strategy year. catch demand is to in utility our trend on say quarters last taken it's backlog that and too Model waiting to second has that's still part I'd your building – And more really our prioritize we're right also, backlog, it to which the few generally to take of our Powerwall think But in the of so a little long residential quite too shift the are long, is focus trying commercial. customers people direction X half We lot of

you, up the Thank work. guys, the Keep awesome Awesome. so appreciate much. time. Really

welcome. You're the questions. for great Thanks

the next to go question, Let's please.

Thank you.

question next with Phil from CNBC. Our comes LeBeau

first are model? Tesla Semi. the it developing Elon. give have you for and terms question Can A in the the you out And some how rolling guys Hi, you reservations on where guys of us many plan in perspective now?

apologies. My

Sorry, question? just repeat something discussing internally. you we were that Could

With process of you when model do rollout are development reservations in Semi, and the guys have cetera? now far many et Tesla as first as you the And the to expect terms timeline, guys the how approximately? the that you of where in happen,

I it's for the we Okay. for to the like have Semi. reservations Semi sales companies sell effort, opportunistic, Yeah, an there's – I really we not about orders About haven't actually X,XXX? us. think Semi. how ongoing don't much. we approaching many tried are something not like like sales know really mean, so really It's

a is real been the good week to margin. need a you're that And We Model leveled That became a need that profitable. we a above is on X. time inaccurate Our a profitable is frankly. the one, criticism is, become you has to company. are, X,XXX good get at company to truth until We not focus to Tesla, it like high

need for a those So and product idea mean, roadmap. to to is like things. do. Model attention excited the we have than I really Pickup's that's things we that. not to we've our (XX:XX:XX) going The our it, one products divide – going Tesla Park we've is an be stay yeah, is too so. many execute I just and great, focus devoted Like, know – awesome product And about right on now. cool be idea focused time. And Generation Semi what amazing. we really roadmap got of Y got more at one the – way to Tesla The good so I'm think to is

up. follow a And

regarding the packed Fremont, a in make manufacturing the Given when fact you're gills decision will that you a second to facility? already

be probably later to has this It later that's this year. year. So

I'm also maybe the China than we for know, but location then quarter, later don't to announce sure of quarter time Model not Gigafactory of I And expect the the So fourth soon. exact Tesla next but Y. in not

in be it, you it Or is America? North going that announce be And will will second when that factory, in China? to

Well, it's just in China. I said

Gigafactory the in the but there, China be So well? is manufacturing plant as will second

yeah, production. Gigafactories vehicle Sorry. all the mean, so, include future, Oh, in will I

production motor factory. are now right, Giga Like, production production. future and But charger and and Gigafactories So, production. and vehicle and at vehicle electronics car all got battery battery production will Fremont we've power incorporate (XX:XX:XX)

you. Thank it. Got

that fact order you'd the in Government be to China manufacturing in appreciation they anything of the that I Chinese like of there China. say appreciative the has that Government allowing very an express would Robin, that just of full regard. announced ownership to of anything? facilities will like to We're is or

so good in are with government, (XX:XX:XX). discussion we'll announce something the We

Okay.

Shanghai. Robin managing next (XX:XX:XX) call earnings is He here was born about me. with in in more say Ren – or talk to So future. Tesla Robin now. is – But next in for right and sales I that we'll the raised worldwide more the we'll have think about lot a

Our James with Albertine comes next question Edge. from Consumer

brief, whether from profile vehicles? autopilot Or more in of And we're if wanted things very accidents, Thanks. likelihood a about test over to helpful. most these lieu really the sense what autopilot get they've your one frequently or it in to you it less technology be you accidents? miles the to and like adopt consumers have the perspective. the the from it time, of seeing Because tested I high have of continue I relates your so whether to daily more this in purchase most existing these of be to can that given confidence ask, used trying consumers the as we opted to or less this they've in us their functionality, relates data functionality would your is that to the you're company coverage give as color received you've any an Can

the percentage of of autopilot. – miles We in the using a increase steady number driven do see

roll As it better, we as we make out more see we functionality, steady increase. a

And on press it's autopilot's And things people there's, I the that of in some people of the this like, We're is of maybe was course, is something then causes good some statistics No on important then what? (XX:XX:XX) that of less. be okay, are reading wrong news – blaming cool. closer in we maybe the not autopilot them victim I that. negative are and the unequivocal then customers, like, And I dips. because – miles, to victim. safety. like, not not cases, in half not that think The that's That's here, our impression. was are the under press accused why that then, for question. the autopilot when then against use it autopilot. one-third order makes highway blaming it but in that I'm a get dangerous improves something But regions,

to that safety statistics I a thing (XX:XX:XX) will be our In mention was basis... going fact, on we one quarterly is publishing

Wonderful.

to than lack (XX:XX:XX). is about do, they understanding fully almost accident, significant is exactly for of issue of can serious not there it of is autopilot complacency. in what is and autopilot, of a more know autopilot what safety too it say, misimpressions Is more common that issue. It's Or is. of an somehow to is that them think people And is, they always one case when – autopilot maybe and driver that – do. thinking the autonomous. it It reason understanding user actually the a we serious it it an it. tends of a autonomous Like, and because that the some be was articles know quite but the think the into accident people It the That get car is getting of thinking like used always, the or is wasn't, was there fact, a worse? opposite case. some ...so on getting one experienced it's better? fully thought misled When they more it,

clarify, far. got out two Elon, pretty to accidents so Just spaced you've

the periods are clarify those during when dips dips where to had you based increasing seeing we are weathered you've accidents those You've your today? comments, occurred. on and But usage,

correct. is That

you Wonderful. so much. Thank

Thank you.

you. Thank

question next with Our from Kallo comes Ben Baird.

Hey, Elon.

or I I number and you're per you had we to Twitter. it's to update Is think Can us week? because a a stakeholders we've a just know makes let of active in can (XX:XX:XX), so here mundane and out a your number to it up it about get are though the there's know not, shareholders fake was out your far want it don't story, So there. push-outs us X,XXX And of that you costs. people way flow production. or are you that if on I what because even the to into when a you have one couple ask slot, hung I important you don't battery remember question, volatility makes Baron news X,XXX I but right now, there of lot of on big believers going a mean vacuum lot have for own, hard that there news

myopic though And get those so of I it's important even we're now, kind being right to very updates. think

Can you question. week and the X? give my Model that's on to X,XXX get X,XXX update think when I per you an so And us

Yeah, actually, track think, the very registrations sieve information that, I is of leak news such quickly. will pretty Tesla And people closely. a leaky also

that and provide carefully. or information in any due most, tracked very a at vehicle just will knowledge two week So, would of advance we public that become be what to registrations shipments are

in happening (XX:XX:XX) a what's on, focused a an not the space things, focused on the or like, you should should be really of like, get weeks So is point This be things. old people few too few is, short-term investing, of long-term focused maxim on months. you

the stock it. our satisfying less. desires couldn't Please interest We care have I of no don't sell day in and traders. buy

quarters, are frustration made volatility and and even out of a has and that right people short-term we want and years on I decades also focus years, They are shaking great ways, there. completely strong understand out everyone's your frustrated now. of myopic great some so I'm too out are of were made be in way say they how to

That's okay.

help on that, to do helpful the can it. you the for (XX:XX:XX) anything near-term in think stock. is And That's I

concerned not is about I'm convince stock. should buy I it think that people if not go. not buy if here Do to to you buy volatility, There our volatility scary. definitely our they are stock. you

question let's our go now. And Okay. last to

you. Thank

with Our last question Piper Potter comes from Alex Jaffray.

Not sure a to a Thanks be this if is question lot. answer. to going guys. hard Hi,

changing class that To as segment the You in denominator, larger mentioned three share what be? Model that X guess, Model market do versus used making the it series to you what I extent others versus think X segment. a is, and

the I will probably increase think I sedans so. number think it Yeah, purchased. of total

ex and buyers So Camry you that think buyers as example? pulling into Accord class you're

Yeah, trade-ins. we know this because of the

X or of see C-Class cars, quite Series. cars. range in not trading owners of of a So or necessarily we a lot the (XX:XX:XX) an AX a the they're wide Audi

with saw Model We even it S. of signs

with Model Even S.

to be So X that is even more Model going prominent.

next And we to give ready, they're I as which think ride car exactly. of The also regulatory the year, not jurisdictions yeah, end like, could long but – would enough (XX:XX:XX) autonomy shared that the as you approval. it's hailing like, dramatically of technically at that's once of Yeah, get when or thing, be soon that effective cost but can ownership I Tesla others. a share expect Model some X with because to, drops

Last interesting. Very one. Okay.

You mentioned production be to of revolution. going earlier the true sort you production is Model think Y a

X Model those specifically to you hope do? to things there incorporate If you into do? would plan specifically would you would've and Or Model had to are that again you what changed, the learnings do some the Y. you What over

and Like, going Y. be better. design save let's talk unveiled think I I it's about will think, The Model when Well, we'll another level. But really production be we really to dramatically system, – for time. that the that next

to Look it (XX:XX:XX). forward Okay.

Model Y, (XX:XX:XX) yeah.

you. Thank

everyone. All good a right. questions. Thanks, Appreciate lot. Thanks the

goodbye. That's much. you Okay. next very thank we time Thank very much, quarter. And and the to you unfortunately have, so speak you all

you participating conference. thank conclude Ladies in program. the today's for and This gentlemen, does

disconnect, and wonderful may You have all a day.